The company started off as “Apple Computer,” best known
for its Macintosh personal computers (PCs) in the 1980s and 1990s. Despite a strong
brand, rapid growth, and high profits in the late 1980s. Company has as rises
up as failures and almost bankrupt situations. One of such situations stands in
1996, so Jobs went to work, transforming “Apple Computer” into “Apple Inc.”. Let’s
identify the core competences till 2008.
The first core competence that we could distinguish was
Apple’s software. The company sticking to its rule of developing everything on
their own created special software iOS operating only on their devices, like
iPhone. Also iTunes can be included in this category as it gave them advantage
over competitors by the possibility to synchronize iPod with computer and it
was used as music library.
The second Apple’s core competence was design of its
devices. It contributed to the uniqueness of the product and high final value
of the product for a customer. Its products featured for example rather small
size in comparison to products of their competitors, as well as interface
simple in use.
The third core competence of Apple was its App Store
introduced in 2008. After just 2 years from its release iPhone was already
comprising 30% of Apple’s revenue, being the biggest growth story globally,
capturing more than 14% of the market. App Store extended its range of usage
additionally contributing to the success.
2008 the second iPhone model was released. It owned 3G networks. Apple renewed
the pricing model under a new agreement with AT&T. The price for it was 199
dollars. And it owned two-year guarantee. An unsubsidized iPhone could cost
$599 for the same version.
Sustained competitive advantage
Sustained competitive advantage
Temporary competitive advantage
Partly competitive advantage
Value -> is it valuable?
Rarity -> is it rare?
Imitability -> is it difficult to imitate?
Organization -> is company organized in a way that fully uses its potential?
Apple’s software was crucial, unique feature that attracted
customers which is why it had high value, and also it could be defined as rare
(it did change the world somehow). The same goes to imitability with
competitors not able to recreate that, as the company worked really hard to
develop it and fully use its potential. As Apple was innovative in every
aspects, such as MacBook, iPod and iPhone, the design of its products was rare
and unique, it cannot be imitated by the competitors, which was also very
valuable for both Apple and its customers. The products stood out and each new
model had some improvements and its potential was broadened. As for the App
Store it was the first product like this on the market, the value of this
feature was important and rare. As Apple tried to do everything to the fullest,
the potential of the App Store was well-managed. The pricing model was also the
crucial part in Apple’s aim to gain the respect from customers as it was
innovative and customers didn’t know what to expect. The contract with AT
in which, for example, iPhones were subsidized by telephone companies to reach
bigger audience. It’s was not rare and was easy to imitate because competitors
could use the same model.
How do you assess Apple’s core competences for the
We strongly believe that the company should keep on developing and
broadening its resources of high technology, as this is what helps them
maintain their advanced position, as well as high quality of goods. Looking
from the perspective of 2008 pricing model would not be anymore Apple’s core
competence because constant improvement of the products would increase their
demand and price. Then App Store would be temporary competitive because its
advantage would be that it’s the only platform where users could get apps
compatible with Apple’s devices. However, with time other companies would also
launch their own App Stores which is why it would not be so rare anymore. As
for design and software they would continue to be their core competencies
because its their unique feature that the company would keep developing.